Yahoo plans announcement Monday in N.Y., Tumblr's hometown

Yahoo is to hold a news conference Monday in New York to announce "product-related news." Above, Yahoo headquarters in Sunnyvale, Calif.

Yahoo is to hold a news conference Monday in New York to announce "product-related news." Above, Yahoo headquarters in Sunnyvale, Calif. (Paul Sakuma / Associated Press)

Salvador Rodriguez

Yahoo is set to hold a news conference Monday, and many believe the company might announce it is acquiring Tumblr.

Rumors began swirling Friday about the possible acquisition, saying Yahoo is interested in buying Tumblr, a social network whose popularity has soared recently, especially among teens and young adults. According to reports, the deal could be worth as much as $1 billion.

Since Marissa Mayer took became chief executive of Yahoo last year, the company has been buying small start-ups, including one by a 17-year-old British entrepreneur for $30 million. Tumblr would be Mayer's biggest purchase yet.